Marketing Modules Series

Marketing Module 3: Company Analysis Example

Adapted from Agriculture Produce Farm Marketing Plan,

Mixed Green Salad Greens:
http://www.mplans.com/agriculture_produce_farm_marketing_plan/executive_summary_fc.php
Accessed March 2013

Sandra Cuellar-Healey, MFS, MA & Miguel Gomez, PhD

Charles H. Dyson School of Applied Economics & Management
College of Agriculture and Life Sciences, Cornell University, Ithaca NY 14853-7801
EB 2013-04i --- June 2013
Complete Marketing Modules Series available at: http://hortmgt.gomez.dyson.cornell.edu/Marketing-Modules.html
• Start-up business
• Offers a wide range of high-quality salad field
greens including red leaf, arugula, radicchio,
mustard greens, endive and chicory
• MG’s mission is to provide the highest quality salad
field greens
• MG’s products have been well received and
marketing is critical to its continued success and
future profitability
MG is a local producer of salad field greens in Eugene,
OR serving both the consumer market as well as local
restaurants. To succeed in developing a profitable
business MG will focus on two competitive advantages:
quality and flexibility. Demand for quality salad field
greens in Eugene is higher than supply. MG’s pursuit of
quality coupled with the flexibility of a small, local
grower will allow it to exploit this market opportunity.
MG’s founder and owner’s relentless pursuit of quality,
extensive background in horticulture and sheer passion
will propel the business into profitability.
Individual consumers:
Who have a more sophisticated palate and appreciate healthier,
tastier alternatives to the common lettuce options. They
appreciate fine dining, and generally are from a higher socio-
economic class. They have access to MG’s products at the firm’s
booth in the Farmers’ Market.
Restaurants:
Generally fine dining restaurants and more specifically
“nouveau cuisine” restaurants. Typically year-round customers
who get a better price but have long-term contracts with MG.
Product is delivered to restaurants.
• Supply:
The increase in supply has reinforced demand within the last years:
many farms that were producing staple vegetables have moved to
production of salad field greens due to increasing demand and higher
margins
• Sales:
Sales for this specific type of produce is forecasted to grow at 8%/yr,
much more than any other agricultural product
• Demand:
• Taste and health consciousness are driving the demand for these
products
• Americans have become more health conscious and salad field greens
support this goal as they are not only inherently healthy but tastier than
the traditional options (romaine and iceberg lettuce)
• Americans are learning to appreciate the more sophisticated taste of this
health food. Presentation as an element of the culinary experience has
taken more value as chefs have become more creative over the last years. It
is becoming a variable in gauging the quality of a meal, and a mix of salad
field greens is aesthetically pleasing
 MG faces three types of competitors:
• Supermarkets: offer convenience in terms of location
and hours of operation, main disadvantages are price
and quality
• Similar local farmers: some are bigger, others are
smaller than MG but there seems to be space for
multiple farmers
• Large distributors: carry a wide variety and quality of
products from farmers to distribute to restaurants.
Price is comparable to local farmers but not the quality
and freshness. They lack the flexibility of local farmers
to address local customers needs
Strengths
• Flexibility to meet restaurant
needs
• High-quality product offerings
that exceed competitors’
offerings on price, quality and
service
• Higher than industry margins
due to production efficiencies
Opportunities
• Growing market with a significant
percentage of the target market still
not aware of MG’s existence
• Ability to develop long-term
commercial contracts which should
lower production costs
Weaknesses
• MG lacks brand equity
• Limited marketing budget to
develop brand awareness
• Decreased degree of flexibility
when near full production
Threats
• Out-of-state, already-established
competitor that makes customer
service and flexibility its selling point
• Food safety scares that question
safety of field salad greens
• Poor weather which will lower yields
The single most important objective is to position MG as the
finest producer of salad greens in its marketing area,
commanding a majority of the market share within five years
with the following marketing and financial objectives:
Marketing Objectives:
• Maintain positive, steady growth each month
• Increase number of new customers who will become
long-term customers
• Generate brand equity at the Farmers Market as well as
within the restaurant industry market

Financial Objectives:
• Realize a 3% increase in gross profit margins every year
Product: Provide a wide choice of high-quality salad field
greens
Pricing: Price will be set on a per-pound basis. Consumers may
purchase any amount of greens, restaurants must purchase in
three-pound quantities. All products will be priced
competitively with respect to true substitutes
Promotion: A mixture of advertisements and networking will
be used to increase visibility for MG
Distribution: Consumers can purchase MG’s products at MG’s
stand at the local Farmers’ Market. Restaurants will have their
produce delivered once or twice a week
• Create customer awareness regarding services offered,
develop the customer base, and work toward building
customer loyalty:
• Increase number of transactions per client
• Increase number of restaurant accounts
• Generate repeat business
• Communicate the message that MG is the finest grower of
high-end salad field greens to its target markets:
• Place advertisements either solely for MG or co-branding with the
Farmers’ Market in both the local newspaper as well as the
art/entertainment paper
• Communicate the message to restaurants through networking
with owners and managers
 Financial Projections
FY 2007 FY 2008 FY 2009
Sales Forecast
Individual Consumers $19,944 $38,899 $51,212
Restaurants $51,428 $72,545 $78,998
Total Sales $71,372 $111,444 $130,210
Direct Costs of Sales
Individual Consumers $2,393 $4,668 $6,145
Restaurants $6,171 $8,705 $9,480
Subtotal Direct Costs of Sales $8,564 $13,373 $15,625
Marketing Expense Budget
Advertising $1,100 $1,100 $1,000
Other $1,050 $1,050 $1,000
Total Sales & Marketing $2,150 $2,150 $2,000
Expenses

Marketing Budget % of Sales 3.01% 1.93% 1.54%

 Performance will be monitored through the
following parameters:

• Revenue: monthly and annual

• Expenses: monthly and annual
• Repeat business
• Customer satisfaction